Investing 25 million dollars is a significant amount of capital that requires careful planning and diversification. When investing such a large sum, it is important to diversify across different asset classes like stocks, bonds, real estate etc. to manage risk. This article provides suggestions on constructing an investment portfolio with 25 million dollars focused on stocks using Fidelity investments.
Allocate 60-70% to stocks using low-cost index funds
The core of a 25 million dollar stock portfolio should comprise of low-cost, broad-based index funds for stability and long term growth. Fidelity offers a suite of low expense ratio index funds that track market benchmarks. Allocating 60-70% across US total stock market index funds, S&P 500 index funds and international stock index funds creates a diversified stock portfolio.
Invest remainder in bonds, real estate, alternatives
The remainder 30-40% of the portfolio can be invested across bonds, real estate and alternative investments for further diversification. High quality bond funds provide income and reduce volatility. Real estate investment trusts (REITs) and rental properties offer additional growth opportunities. Up to 10% could be set aside for alternative investments like private equity.
Rebalance portfolio over time
It’s important to rebalance the portfolio regularly over time to maintain target allocations to different asset classes as markets shift. This disciplined rebalancing forces investors to sell high and buy low.
In summary, a 25 million dollar stock portfolio should focus on broad diversification across stocks using low-cost index funds as the core holding. Spreading the investments to other assets brings stability. Rebalancing over long term is key.